Aqua Metals Inc., a Reno, Nevada-based battery materials recycling firm and technology provider, has executed a nonbinding term sheet for an up to $33 million loan from one of the largest privately held companies in the world that invests in decarbonization initiatives.
The company also has obtained an additional $7 million by selling common stock shares and warrants priced from 1 cent to 39 cents. “This capital infusion is expected to complete phase one of the Sierra AquaRefining Campus (ARC) buildout and commissioning in 2024,” the firm says of its lithium-ion battery recycling campus in its home state of Nevada.
Aqua Metals focused on solvent-based lead-acid battery recycling in the previous decade before engaging in a partial pivot to the recycling of electric vehicle (EV) and other lithium-ion batteries this decade.
Regarding its lead-acid battery efforts, in comments accompanying its 2023 financial results, Aqua Metals says part of its losses last year were a result of the suspension of the development of recycling operations at the ACME Metals Taiwanese facility, a lead-acid battery recycling venture announced in 2021.
In addition to the capital it recently has raised, Aqua Metals has been awarded an economic incentive package of approximately $2.2 million that provides partial tax relief toward $35 million worth of equipment, building and land improvements underway at the Sierra facility.
Aqua Metals also has been awarded a $371,000 grant from the U.S. Department of Energy to work on a minerals recovery initiative in cooperation with Penn State University.
For the first quarter of this year, Aqua Metals has reported an operating loss of $5.79 million compared with an operating loss of $4.5 million in the first quarter of last year. The firm’s net loss for the first quarter of this year was $5.75 million, which compares with a net loss of $4.6 million one year ago.
The company's expenses related to plant operations increased by approximately 107 percent during the quarter just completed, rising to $2.2 million compared with about $1.1 million in the first quarter of last year.
Aqua Metals says cost escalation was primarily due to an increase in payroll and payroll-related fees of approximately $556,000 as we hired additional staff to operate and train at the pilot facility to be ready to staff the phase one commercial plant starting in the third quarter of 2024.
The company's research and development costs also increased early this year, rising 32 percent from one year ago. As of March 31, Aqua Metals says it had $8.3 million in cash and cash equivalents on hand, while total cash used in operations for the first three months of 2024 was $4.3 million.
Aqua Metals President and CEO Steve Cotton strikes an optimistic tone about the firm’s ability to raise capital. “By finalizing this term sheet and moving toward a comprehensive financing agreement, we are positioning Aqua Metals to meet the growing demand for recycled battery materials," he says.
“We continue to view 2024 as a pivotal year for Aqua Metals, as we advance commercial initiatives and bolster our position as a leader in this important, maturing industry.”
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